XI'AN, China, May 13, 2016 /PRNewswire/ -- China Green Agriculture, Inc. (NYSE: CGA;
"China Green Agriculture" or the "Company"), a company mainly produces and distributes humic acid-based compound fertilizers,
other varieties of compound fertilizers and agricultural products through its subsidiaries in China, today announced its
financial results for the quarter ended March 31, 2016.
Highlights
- Net sales in the Third Quarter of FY 2016 decreased 1.1% to $78.6 million; net income decreased 16.8% to $8.3
million with EPS of $0.22.
- The Company Provided Fourth Quarter of Fiscal Year 2016 Guidance Range: Revenue, Net Income and EPS of between $74 million and $80 million, $3 million and $7 million, and $0.08 and
$0.19 based on 37 million fully diluted shares, respectively.
- The Company Raised Guidance Range of Fiscal Year 2016 as the following: Revenue, Net
Income and EPS of between $264 million and $270 million, $23 million and $27 million, and $0.62 and $0.73 based on 37 million fully diluted shares,
respectively.
Financial Summary
Third Quarter 2016 Results (USD)
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(Three Months ended March 31, 2016)
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Q3 FY2016
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Q3 FY2015
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CHANGE (%)
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Net Sales
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$78.6 million
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$79.5 million
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(1.1)%
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Gross Profit
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$24.7million
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$28.2 million
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(12.3)%
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Net Income
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$8.3 million
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$9.9 million
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(16.8)%
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EPS (Diluted)
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$0.22
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$0.29
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(21.7)%
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Weighted Average Shares Outstanding (Diluted)
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$37.0million
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$34.8 million
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6.3%
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(Nine Months ended March 31, 2016)
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|
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Q3 FY2016
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Q3 FY2015
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CHANGE (%)
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Net Sales
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$189.8 million
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$184.8 million
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2.7%
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Gross Profit
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$71.6 million
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$75.8 million
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(5.6)%
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Net Income
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$19.8 million
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$23.2 million
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(14.9)%
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EPS (Diluted)
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$0.54
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$0.69
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(22.2)%
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Weighted Average Shares Outstanding (Diluted)
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$36.6 million
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$33.5 million
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9.4%
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"We are very pleased with our performance in business operation, which generated $8.3 million
net income in the third quarter ended March 31, 2016. Although revenues and net income decreased
year over year, we did better than we expected," said Mr. Tao Li, Chairman and Chief Executive
Officer of China Green Agriculture."Looking ahead to the fourth quarter of fiscal year 2016, we expect net sales of $74 to
$80 million, net income of $3 to $7 million, and EPS
of $0.08 to $0.19 based on 37 million fully diluted weighted average shares outstanding
for the fourth quarter ended June 30, 2016. We are confident in achieving our target for the fourth quarter of fiscal year
2016. We believe our growth plan will well serve the interests of our shareholders."
"I have aspired to apply my skill set and experience in the agriculture industry," said Mr. Zhuoyu
Li, the newly appointed President of the Company, "Joining the Company and being able to work side by side with my father is
that aspiration realized. I am very excited for this career opportunity and am humbly grateful for the trust from the board. I
will devote myself to the growth of the Company with full energy."
Third Quarter of FY2016 Results of Operations
Net Sales
Total net sales for the three months ended March 31, 2016 were $78,638,474, a decrease of $848,741, or 1.1%, from $79,487,215 for the three months ended March 31, 2015. This decrease was due to
the decrease in Jinong's sales volume and Gufeng's lowering selling prices to answer to the market demand.
Cost of Goods Sold
Total cost of goods sold for the three months ended March 31, 2016 was $53,904,185, an increase of $2,607,487, or 5.1%, from $51,296,698 for the three months ended March 31, 2015. This increase was mainly
due to higher raw material cost and packaging cost.
Gross Profit
Total gross profit for the three months ended March 31, 2016 decreased by $3,456,228, or 12.3% to $2,441,652, as compared to $28,190,517 for the three months ended March 31, 2015. Gross profit margin was
31.5% and 35.5% for the three months ended March 31, 2016 and 2015, respectively. The decrease was
mainly due to the increase in Jinong's product costs and the increased weight for lower-margin products sales in Gufeng's total
sales.
Selling Expenses
Selling expenses were $3,441,511, or 4.4%, of net sales for the three months ended March 31, 2016, as compared to $2,054,025 or 2.6% of net sales for the three
months ended March 31, 2015, an increase of $1,387,486, or 67.5%. The
increase was mainly due to Jinong's expanded marketing efforts and the increase in shipping costs.
Selling Expenses – amortization of deferred assets
Our selling expenses - amortization of our deferred assets were $8,780,893, or 11.2%, of net
sales for the three months ended March 31, 2016, as compared to $10,604,586, or 13.3% of net sales for the three months ended March 31, 2015, a
decrease of $1,823,693, or 17.2%. This decrease was due to the fact that some of the deferred
assets were fully amortized and therefore no amortization was recorded on the fully amortized assets during the three months
ended March 31, 2016.
General and Administrative Expenses
General and administrative expenses were $2,204,771, or 2.8% of net sales for the three months
ended March 31, 2016, as compared to $2,606,749, or 3.3% of net sales
for the three months ended March 31, 2015, a decrease of $401,978, or
15.4%. The decrease in general and administrative expenses was mainly due to the related expenses in the stock compensation
awarded to the employees which amounted to $580,388 for the three months ended March 31, 2016 as compared to $1,081,125 for the three months ended March 31, 2015.
Net Income
Net income for the three months ended March 31, 2016 was $8,251,771, a decrease of $1,664,423, or 16.8%, compared to $9,916,194 for the three months ended March 31, 2015. The decrease was
attributable to the increased selling expenses and lower net sales in the quarter ended March 31,
2016. Net income as a percentage of total net sales was approximately 10.5% and 12.5% for the three months ended
March 31, 2016 and 2015, respectively.
The First Nine Months of FY2016 Results of Operations
Net Sales
Total net sales for the nine months ended March 31, 2016 were $189,788,745, an increase of $4,948,566 or 2.7%, from $184,840,179 for the nine months ended March 31, 2015. This increase was largely
due to Gufeng's expanded marketing promotion strategy and the increase in sales demand on Yuxing's top-grade flowers.
Cost of Goods Sold
Total cost of goods sold for the nine months ended March 31, 2016 was $118,230,726, an increase of $9,164,492, or 8.4%, from $109,066,234 for the nine months ended March 31, 2015. This increase was mainly
due to the 2.7% increase in net sales and an increase in the cost of raw materials.
Gross Profit
Total gross profit for the nine months ended March 31, 2016 decreased by $4,215,926 to $71,558,019, as compared to $75,773,945 for the nine months ended March 31, 2015. Gross profit margin was
37.7% and 41.0% for the nine months ended March 31, 2016 and 2015, respectively. The decrease was
mainly due to Jinong's higher raw material cost and packaging cost and the increased weight for lower-margin products sales in
Gufeng's total sales answering to market demand.
Selling Expenses
Selling expenses were $11,070,727, or 5.8%, of net sales for the nine months ended March 31, 2016, as compared to $4,770,727 or 2.6% of net sales for the nine
months ended March 31, 2015, an increase of $6,299,642, or 132.0%.
The increase was mainly due to Jinong's expanded marketing efforts and the increase in shipping costs.
Selling Expenses – amortization of deferred assets
Our selling expenses - amortization of our deferred assets were $27,158,360, or 14.3%, of net
sales for the nine months ended March 31, 2016, as compared to $31,587,102, or 17.1% of net sales for the nine months ended March 31, 2015, a
decrease of $4,428,742, or 14.0%. This decrease was due to the fact that some of the deferred
assets were fully amortized and therefore no amortization was recorded on the fully amortized assets during the nine months ended
March 31, 2016.
General and Administrative Expenses
General and administrative expenses were $7,864,395, or 4.1% of net sales for the nine months
ended March 31, 2016, as compared to $8,920,360, or 4.8%, of net
sales for the nine months ended March 31, 2015, a decrease of $1,055,965, or 11.8%. The decrease in general and administrative expenses was mainly due to the decreased
related expenses in the stock compensation awarded to the employees which amounted to $2,899,390 for the nine months ended March 31, 2016 as compared to $4,150,995 for the nine months ended March 31, 2015.
Net Income
Net income for the nine months ended March 31, 2016 was $19,764,978, a decrease of $3,465,735, or 14.9%, compared to $23,230,713 for the nine months ended March 31, 2015. The decrease was
attributable to the increase in net sales offset by an increase in selling expenses and the higher cost of good sold. Net income
as a percentage of total net sales was approximately 10.4% and 12.6% for the nine months ended March 31,
2016 and 2015, respectively.
Financial Condition
As of March 31, 2016, cash and cash equivalents were $90,470,157,
a decrease of $2,512,407, or 2.7%, from $92,982,564 as of
June 30, 2015. Net cash used in investing activities for the nine months ended March 31, 2016 was $16,608, a decrease of $7,658,533, or 99.8% from $7,675,141 for the nine months ended March 31, 2015. Net cash used in financing activities for the nine months ended March
31, 2016 was $17,493,160, an increase of $14,803,429 or 550.4%
compared to cash provided by financing activities of $2,689,731 for the nine months ended
March 31, 2015. We had accounts receivable of $74,730,414 as of
March 31, 2016, as compared to $68,528,598 as of June 30, 2015, an increase of $6,201,816 or 9.0%.
Fourth Quarter Fiscal Year 2016 and Fiscal Year 2016 Guidance
For the fourth quarter ending June 30, 2016, management expects net sales of $74 to $80 million, net income of $3 to $7 million, and EPS of $0.08 to $0.19 based on 37 million fully diluted shares. For the fiscal year
ended June 30, 2016, management expects net sales of $264 million to $270 million, net
income of $23 million to $27 million, and an EPS of $0.62 to
$0.73 based on 37 million fully diluted shares.
Conference Call Information
The Company will hold a conference call at 7:30 am ET on May 13,
2016 to discuss its third quarter 2016 results. The Company's newly appointed President, Mr.
Zhouyu Li will host the earnings conference call. Listeners may access the call by dialing:
PARTICIPANT DIAL IN (TOLL FREE):
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1-888-346-8982
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PARTICIPANT INTERNATIONAL DIAL IN:
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1-412-902-4272
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Hong Kong-Local Toll
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852-301-84992
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Beijing-Local Toll
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86-105-357-3132
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China Toll Free
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4001-201203
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Hong Kong Toll Free
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800-905945
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To access the replay, please dial any of the following numbers:
US Toll Free:
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1-877-344-7529
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International Toll:
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1-412-317-0088
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Canada Toll Free:
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855-669-9658
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Replay Access Code:
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10086244
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About China Green Agriculture, Inc.
The Company produces and distributes humic acid-based compound fertilizers, other varieties of compound fertilizers and
agricultural products through its wholly-owned subsidiaries, i.e.: Shaanxi TechTeam Jinong Humic Acid Product Co., Ltd.
("Jinong"), Beijing Gufeng Chemical Products Co., Ltd. ("Gufeng"), and a variable interest entity, Xi'an Hu County Yuxing
Agriculture Technology Development Co., Ltd. ("Yuxing"). Jinong produced and sold 130 different kinds of fertilizer products as
of March 31, 2016, all of which are certified by the government of the
People's Republic of China (the "PRC") as Green Food Production Materials, as stated by the China Green Food Development
Center. Jinong currently markets its fertilizer products to private wholesalers and retailers of agricultural farm products in 27
provinces, four autonomous regions, and three central-government-controlled municipalities in the PRC. Jinong had 1,064
distributors in the PRC as of March 31, 2016. Gufeng, and its wholly-owned subsidiary, Beijing
Tianjuyuan Fertilizer Co., Ltd., are Beijing-based producers of compound fertilizers, blended
fertilizers, organic compound fertilizers, and mixed organic-inorganic compound fertilizers. As of March
31, 2016, Gufeng produced and sold 332 different kinds of fertilizer products, and had 299 distributors in the PRC. For
more information, visit http://www.cgagri.com. The Company
routinely posts important information on its website.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of
1995 concerning the Company's business, products and financial results. The Company's actual results may differ materially from
those anticipated in the forward-looking statements depending on a number of risk factors including, but not limited to, the
following: general economic, business and environment conditions, development, shipment, market acceptance, additional
competition from existing and new competitors, changes in technology, the execution of its ten-year growth plan, a satisfactory
conclusion of the pending securities class action litigation and various other factors beyond the Company's control. All
forward-looking statements are expressly qualified in their entirety by this Safe Harbor Statement and the risk factors detailed
in the Company's reports filed with the SEC. China Green Agriculture undertakes no duty to revise or update any forward-looking
statements to reflect events or circumstances after the date of this release, except as required by applicable law or
regulations.
For more information, please contact:
China Green Agriculture, Inc.
Mr: Fang Wang (English and Chinese)
Tel: +86-29-88266500
Email: wangfang@cgagri.com
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SOURCE China Green Agriculture, Inc.